Powell fails, markets gain - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

Powell fails, markets gain

Feb 8, 2003

After an initial bout of optimism due to strong numbers posted by Digital, pessimism dominated the first half of the week. Markets were concerned about the US charge against Iraq getting a green signal from the Security Council. However, with the US Secretary of State Mr. Collin Powel failing to convince the war skeptics brought back cheer to the markets. Software stocks were the main beneficiaries of Mr. Powell’s failure. Also expectations of the Government taking some positive steps on the infrastructure front, especially power, caused significant buying interest in engineering and power stocks. For the week, Nifty closed with gains of 1.5%, while the BSE Sensex gained marginally lesser (0.9%). With these gains the bourses ended their two-week loosing streak

Selling in the previous sessions caused a number of blue chips to decline to attractive valuations. Consequently, the week started off with bottom fishing at lower levels. Also, Digital’s numbers that were declared towards the end of the previous week further buoyed sentiment towards the technology sector. Tuesday saw profit taking in software stocks. However, the sector that has held the markets awe, banking was back in favour.

Top 5 gainers for the week: BSE 'A' Group
CompanyPrice on Jan 31,
2003 (Rs)
Price on Feb 7,
2003 (Rs)
% Change52-Week H/L (Rs)
BSE-SENSEX 3,250 3,280 0.9%3,758 / 2,828
S&P CNX NFTY 1,042 1,058 1.5%1,206 / 920
SHIP. CORP. 62 72 15.7%112 / 48
HINDUJA FIN. 185 214 15.7%400 / 119
BHEL 178 200 12.2%208 / 144
MOSER-BAER INDIA 210 231 10.3%365 / 137
ASHOK LEYLAND 95 104 9.7%123 / 67

Wednesday was the black day of the week. The bourses witnessed nervousness ahead of Mr. Collin Powell’s address to the UN Security Council. Software stocks drew most of the flak. Concerns are that if US goes to a war with Iraq, business sentiment might turn even grimmer and spending of IT might take a hit. But it was not all pessimism. Engineering and utilities witnessed buying on expectations of the Government stepping up spending of the infrastructure front especially. With the power sector too the focus of reforms has shifted from generation to transmission and distribution. Consequently, ABB and BHEL that provide equipments for this segment closed the week with significant gains. Also, the fourth quarter is usually the strongest quarter for BHEL.

NIIT, the IT education major announced the acquisition of eGurucool.com, an online education company offers undisclosed sum. However, a leading business daily put the figure at Rs 150 m. This move will broaden NIIT portfolio of offerings. The company will transform from being an IT education company to be being an IT assisted education company. With the acquisition NIIT will now target the school segment that is a significantly bigger market as compared to the demand for IT education. Another advantage the company has is its significant presence in the country with about 2,445 centres.

Top 5 losers for the week: BSE 'A' Group
CompanyPrice on Jan 31,
2003 (Rs)
Price on Feb 7,
2003 (Rs)
% Change52-Week H/L (Rs)
SHREE RAMA MULTI 8 7 -15.0%40 / 7
PENTAMEDIA 15 13 -13.6%63 / 13
HFCL 31 28 -10.2%90 / 25
SILVERLINE TECH 14 13 -9.0%66 / 13
MTNL 117 107 -8.5%177 / 81

Thursday opened on a weak note. However, half an hour before close, technology stocks staged a strong come back. Trading on the last day of the week saw a bout of profit taking. Stocks that lost ground during the days trading were index heavyweights, like Reliance and HLL.

Going forward, the US-Iraq conflict will be like a dark cloud loom over the horizon. The markets will increasingly concentrate on speculating the possible budget measures and this will give a bearing to trading in the week ahead.

Equitymaster requests your view! Post a comment on "Powell fails, markets gain". Click here!


More Views on News

An Important Hurricane Update for Energy Traders (Fast Profits Daily)

Sep 22, 2020

In this video, I'll show you how the extended hurricane season in the US will affect traders in crude oil and natural gas.

Mutual Fund Investors Will Now Be Allotted Units Based on NAV of the Day AMCs Receive Funds (Outside View)

Sep 22, 2020

PersonalFN explains how SEBI's new circular on mutual funds impact investors.

My Top Stock to Buy in this Market Selloff (Profit Hunter)

Sep 22, 2020

The recent correction offers a great opportunity to buy this high conviction smallcap stock.

How Much Money Should an Investor Set Aside for Trading? (Fast Profits Daily)

Sep 21, 2020

In this video, I'll give you a simple equation which you can use to decide how much money you can set aside for trading.

Kotak Standard Multicap Fund: Strategizing Growth with Focused Approach (Outside View)

Sep 21, 2020

PersonalFN's analysis on the features and performance of Kotak Standard Multicap Fund.

More Views on News

Most Popular

How the 8-Year Cycle Can Help Identify Multibaggers (Fast Profits Daily)

Sep 11, 2020

This is how you can apply the greed and fear cycle in the market to pick stocks.

Why am I Recommending Caution? (Fast Profits Daily)

Sep 9, 2020

This is why I have changed my short-term view on the market.

Why We Picked This Small-cap Stock for Our Hidden Treasure Subscribers (Profit Hunter)

Sep 17, 2020

This leading household brand will profit big time in a post covid world.

This Could Be the Best September for Auto Stocks (Profit Hunter)

Sep 11, 2020

Here's why I think this month could be a great for auto stocks.


Covid-19 Proof
Multibagger Stocks

Covid19 Proof Multibaggers
Get this special report, authored by Equitymaster's top analysts now!
We will never sell or rent your email id.
Please read our Terms


Sep 22, 2020 (Close)